The ITO(Exemptions), Ward-1, Ahmedabad V. Late Lalbahadur Shashtri Smruti Education Trust, Ahmedabad

ITA 1489/AHD/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5773 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 9 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-03-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2012-2013
• Appeal Filed On: 03-06-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: JIGNESHKUMAR P PARIKH
• Keywords: Depreciation; Charitable institution

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD C BENCH AHMEDABAD BEFORE, SHRI N. K. BILLAIYA , ACCOUNTANT MEMBER AND SHRI S. S. GODARA, JUDICIAL MEMBER ITA NO. 1489/AHD/2016 (ASSESSMENT YEAR : 2012-13) INCOME TAX OFFICER(EXEMPTIONS), WARD -1, AHMEDABAD APPELLANT VS. LATE LALBAHADUR SHASHTRI SMRUTI EDUCATION TRUST, P. S. PATEL EDUCATION CAMPUS, NR. SAMBHAVI COMPLEX, OPP: NITYANIDHI SOCIETY, GHATLODIYA, AHMEDABAD-380061 RESPONDENT PAN: AAATL4505F / BY REVENUE : SHRI PRASOON KABRA, SR. D.R. / BY ASSESSEE : SHRI JIGNESHKUMAR P. PARIKH, A .R. /DATE OF HEARING : 22.03.2018 /DATE OF PRONOUNCEMENT : 28.03.2018 ORDER PER S. S. GODARA, JUDICIAL MEMBER THIS REVENUES APPEAL FOR ASSESSMENT YEAR 2012-13 A RISES FROM THE CIT(A)- 9, AHMEDABADS ORDER DATED 29.04.2016, IN CASE NO. CIT(A)-9/26/ITO (EXEMP.) BHAVNAGAR/15-16, IN PROCEEDINGS U/S.143(3) OF THE I NCOME TAX ACT, 1961; IN SHORT THE ACT. HEARD BOTH THE PARTIES. CASE FILE PERUSED. 2. THE REVENUE APPEARS TO BE RAISING TWO SUBSTANTIV E GROUNDS IN CHALLENGING THE CIT(A)S ORDER REVERSING ASSESSING OFFICERS AC TION DISALLOWING ASSESSEES ITA NO. 1489/AHD/16 [ITO(E) VS. LATE LALBAHADUR SH ASHTRI SMRUTI EDUCATION TRUST ] A.Y. 2012-13 - 2 - DEPRECIATION CLAIM OF RS.17,17,226/- AS A CASE OF D OUBLE DEDUCTION AS WELL AS THAT OF CARRY FORWARD DEFICIT OF RS.94,98,669/- AS MADE BY THE ASSESSING OFFICER IN ASSESSMENT ORDER DATED 09.03.2015. 3. THE RELEVANT FACTS ARE IN A VERY NARROW COMPASS. THERE IS NO DISPUTE ABOUT THE ASSESSEE BEING A CHARITABLE TRUST. IT HAD CLAI MED THE IMPUGNED DEPRECIATION AS WELL AS CARRY FORWARD OF DEFICIT. THE ASSESSING OF FICER REJECTED BOTH THESE CLAIMS. HE OBSERVED QUA THE FORMER ISSUE THAT THE ASSESSEE S ACTION IN CLAIMING COST OF THE RELEVANT ASSETS REQUIRED FOR THE PURPOSE OF APPLICA TION OF INCOME AS WELL AS THE DEPRECIATION IN QUESTION AMOUNTED TO A CASE OF DOUB LE DEDUCTION. HE THEN REDUCED ASSESSEES LATTER CLAIM OF CARRY FORWARD OF DEFICIT ON ACCOUNT OF 15% ACCUMULATION TO NIL FIGURE. 4. THE ASSESSEE PREFERRED APPEAL. THE CIT(A) REVER SED THE ASSESSING OFFICERS ACTION ON BOTH COUNTS AS UNDER: 4.3 IN VIEW ABOVE AND RESPECTFULLY FOLLOWING THE J UDGMENTS BY HON'BLE GUJARA: HIGH COURT IN THE CASE OF SHETH MANILAL RANCHHODDAS VISHRAM BHAVAN TRUST 198 ITR 598 (GUJ.) MENTIONED ABOVE, I AM OF THE VIEW TH AT ADDITION OF RS. 17,17,226/- ON ACCOUNT OF DISALLOWANCE OF DEPRECIATION BE DELET ED. GROUND NO.2, IS ACCORDINGLY ALLOWED. FURTHER, I AGREE WITH THE CONTENTION OF TH E APPELLANT THAT U/S.11(1)(A) OF THE ACT, THE TERM USED IS 'INCOME' AND NOT 'TOTAL I NCOME.' ACCORDINGLY, THE DEPRECIATION WILL BE ALLOWED WHILE COMPUTING THE IN COME U/S.11(1)(A) OF THE ACT. THUS, GROUND OF APPEAL NO.1 IS ALSO ALLOWED. 5. GROUND NO.3, IS REGARDING NOT ALLOWING TO SET OF F CARRIED FORWARD DEFICIT ON ACCOUNT OF 15% ACCUMULATION AS APPLICATION TOWARDS OBJECT OF THE TRUST. I HAVE PERUSED THE ORDER OF A.O AND SUBMISSIONS MADE IN TH IS REGARD BY THE APPELLANT. RELYING ON THE DECISIONS OF HON'BLE GUJARAT HIGH CO URT IN THE CASE OF CIT VS SHRI PLOT SHWETAMBAR MURTIPUJAK JAIN MANDAL 211 ITR 293, I FIND THAT THE APPELLANT SHOULD GET THE BENEFIT OF THE DEFICIT OF EARLIER YE ARS AGAINST THE FUTURE INCOME. THUS THE APPELLANT IS ALLOWED TO SET OFF OF CARRIED FORW ARD DEFICIT ON ACCOUNT OF 15% ACCUMULATION AS APPLICATION TOWARDS THE OBJECT OF T HE TRUST. THUS, THIS GROUND OF APPEAL IS ALLOWED. 5. LEARNED DEPARTMENTAL REPRESENTATIVE VEHEMENTLY A RGUES IN SUPPORT OF THE REVENUES TWO SUBSTANTIVE GROUNDS IN SEEKING TO REV IVE THE ASSESSING OFFICERS ACTION. WE FIND THAT HONBLE APEX COURTS LATEST J UDGMENT IN CIT VS. RAJASTHAN AND GUJARATI CHARITABLE FOUNDATION, POONA IN CA NO. 145 3/2017 DECIDED ON 13.12.2017 ITA NO. 1489/AHD/16 [ITO(E) VS. LATE LALBAHADUR SH ASHTRI SMRUTI EDUCATION TRUST ] A.Y. 2012-13 - 3 - HAS ANALYZED THE ENTIRE LEGAL AND FACTUAL POSITION TO CONCLUDE THAT SUCH DEPRECIATION CLAIM DOES NOT AMOUNT TO DOUBLE DEDUCTION. THEIR L ORDSHIPS ALSO CONSIDER LEGISLATIVE AMENDMENT VIDE FINANCE ACT, 2014 IN SEC TION 11(6) OF THE ACT TREATING SUCH A CLAIM TO BE DOUBLE DEDUCTION FROM ASSESSMENT YEAR 2015-16 ONLY WHEREAS WE ARE IN ASSESSMENT YEAR 2012-13. WE THUS SEE NO REA SON TO ACCEPT REVENUES INSTANT FORMER SUBSTANTIVE GROUND. 6. COMING TO LATTER ISSUE, IT HAS COME ON RECORD TH AT HONBLE JURISDICTIONAL HIGH COURTS JUDGMENT (SUPRA) HAS ALREADY HELD THAT A CH ARITABLE TRUST IS ENTITLED FOR CARRY FORWARD OF EARLIER YEARS DEFICIT AGAINST THE CORRE SPONDING INCOME OF THE LATTER ASSESSMENT YEARS. THERE IS NO EXCEPTION INDICATED DURING THE COURSE OF HEARING BEFORE US. THE REVENUES INSTANT LATTER SUBSTANTIV E GROUND IS ALSO REJECTED. 7. THIS REVENUES APPEAL IS ACCORDINGLY DISMISSED. [PRONOUNCED IN THE OPEN COURT ON THIS THE 28 TH DAY OF MARCH, 2018.] SD/- SD/- ( N. K. BILLAIYA ) (S. S. GODARA) ACCOUNTANT MEMBER JUDICIA L MEMBER AHMEDABAD: DATED 28/03/2018 TRUE COPY S.K.SINHA / COPY OF ORDER FORWARDED TO:- / REVENUE 2 / ASSESSEE ! / CONCERNED CIT 4 !- / CIT (A) ( )*+ ,--. . /0 / DR, ITAT, AHMEDABAD 1 +23 45 / GUARD FILE. BY ORDER / . // . /0